With the current COVID-19 will there be a shakeup of smartphone brands in India? At the end of the year which brands will gain market share and which brands will lose? What would be the reasons?
The COVID-19 has become a global calamity. The virus has not only affected large number of people around the globe but also become the reason for the economy to get derailed and it has affected the supply chain of world. Due to the outbreak of this virus every country has imposed lockdown and all the factories are closed in India. There has been a decline in the sales of non-essential goods due to the lockdown.
Smartphone sector is one of the major sectors affected by this global pandemic. There has been a decline in the rate of production of smartphones since the lockdown was imposed. According to the reports, global smartphone production had a great increase to 14 percent in the year 2019 as compared to the year 2016 where the production rate was 9 percent. The US-China trade war was the main reason for this besides, various incentives in countries like India to promote its initiatives like “Make in India”. But in the current scenario it is estimated that India’s share in the global production of smartphones is to decline back to the rate of 9 percent due to the lockdown and manufacturing activities are at halt. Moreover, there is also less demand for the smartphones during the period. The demand for the smartphones will also remain low if lockdown continues.
In India, smartphones in the mid-range of Rs. 10,000 to Rs. 15,000 are the most preferred range as compared to other expensive premium smartphones. Under present ongoing COVID-19 pandemic, there would be a decline in the sales of premium and expensive smartphones of all the leading smartphone manufactures as compared to the mid-range smartphones. The companies would also try to target the mid-range smartphones to increase their sales of the smartphones. The companies like Xiaomi and Realme mainly launch mid-range phones and try to provide as many features they can, so these companies can come up with some offers to increase the sales of their mid-range smartphones and by the end of the year the brands like Xiaomi and Realme can gain market share. Whereas, customer’s loyalty towards the premium brands of smartphones will only be the main reason for sale of these smartphones.
The sale of the below mid-range smartphones will also be affected as there is recession in economy and this will result in low income. Majority of customer still prefer to buy smartphones offline and they will be affected largely and would lead to decline of the sales of these smartphones whereas, the mid-range smartphone segment will be affected the least.
On the other hand one of the major reasons to increase the sales of the mid-range smartphones is the launch of “Arogya Setu” application, being made mandatory by the Indian government for everyone. Therefore, people having basic feature phone have no option except to switch over to a smartphone and this will be also a reason for increasing the sales of mid-range smartphones by the end of the year. Staying home requires staying connected is one of the reasons given by the major smartphone companies to the government to list smartphones as an essential item on the grounds to order essentials like medicine, groceries, milk and e-ticketing. In addition, many schools and colleges have started virtual online classes which will increase the demand of smartphones. If the government exceeds to the demand of smartphone manufacturing companies to put smartphones under essential item categories, the sale of smartphone is bound to increase once again.
The above reasons clearly indicate that the brands like Xiaomi and Realme will have a great market share at the end of the year as these brands have the largest market in India whereas, premium brands like Apple and OnePlus are expensive, hence their sales is also likely to be affected but not majorly. Further, the sales for the brands like Vivo might decline considerably in India as the result of the pandemic.
